06 March 2019

I recently attended a meeting of investors, asset managers, foundations, family offices, and social entrepreneurs organised in New York by the Financial Times to explore “gender lens investing,” that is, investing in women and girls to boost overall development impact alongside a financial return. The discussions focused on this new niche as the next big thing in impact investing.

...[N]ew research published in the Stanford Social Innovation Review suggests that if women were to attain equal participation in the economy, they could raise global GDP by up to $28 trillion or 26 per cent in 2025.

McKinsey and Co. estimates that advancing women’s equality in Asia-Pacific countries would raise their annual collective GDP by $4.5 trillion in 2025, a 12 per cent increase over the business-as-usual trajectory. Investing in women yields multiple benefits for corporations, according to an International Finance Corporation (IFC) study.

...[T]he Inter-American Development Bank and the Overseas Private Investment Corporation recently partnered to launch Fund Mujer, the first gender-focused fund for Latin America and the Caribbean, which could serve as inspiration (as well as a catalyst for) similar IFI-backed funds in other parts of the world.

Another example is the IFC’s Banking on Women program, which provides financing and expertise for women-owned small and medium-sized enterprises (SMEs).

In 2017, some 43 per cent of ADB’s annual new investment of $20 billion went into investment projects and transactions that help to narrow gender gaps and empower women and girls. A little over a year ago, ADB issued its first gender bond to finance a pool of eligible projects that promote gender equality and women’s empowerment in Asia and the Pacific, purchased in its entirety by Japan’s Dai-Ichi Life Insurance Company.

...Growth in gender lens investing is constrained by a sparse pipeline of investees as well as lack of well-defined metrics for gender impact.

IFIs have clearly realised the immense potential of investing in women and girls. Now it’s time to stay the course and look forward to future generations thriving in a gender-inclusive world.